Capital Gains Tax on Cryptocurrency and Cryptoassets

UK capital gains tax (CGT) on cryptocurrency and cryptoassets is different to CGT on property and other assets when you sell, gift or dispose of them.  See

The Start and History of CGT Budget and CGT History and

What Assets are Subject to CGT? Assets Subject to CGT

What is the same?

• Disposals of cryptoassets with gains within the £3,000 annual CGT allowance are CGT free.
• Disposals of cryptoassets by gifting/transferring to spouses or civil partners are CGT free.

What is different?

• Disposals of cryptoassets by gifting/transferring to charities are subject to CGT when they are not for other assets.

What Disposals of Cryptoassets are Subject to CGT?

As well as charities already detailed above, the following disposals are also subject to CGT:

• Disposals of cryptoassets to other family members, friends or businesses are subject to CGT.
• Selling cryptoasset tokens for money or money’s worth are subject to CGT.
• Exchanging one type of cryptoasset asset e.g.  Bitcoin to another type of cryptoasset e.g., Ethereum is a disposal and subject to CGT.
• Using cryptoasset tokens to pay for goods and services or spending from your cryptoasset bank account or cryptoasset debit card or making withdrawals from a cryptoasset ATM (cash withdrawal machines – ‘the whole in the wall’) are all disposals and subject to CGT.

Calculation of CGT is Different if you Buy then Sell within 30 days

Normally for most asset disposals including cryptoasset disposals, it is the sale price (including expenses) less the purchase price (including expenses) that gives you the gain to work out your CGT liability but if you buy then sell within 30 days may be different if you are trading in cryptoassets.

Cryptoasset Trading is where you regularly trade and run your own cryptoasset activities as a business e.g.  a Self Employed Cryptoasset Trader. 

• Income less expenses = taxable profit.
• Taxable profit is subject to income tax and not capital gains tax.
• If you have paid income gains tax on the exchange/trade it is not subject to capital gains tax.
• You can offset other ‘business’ expenses against your profit such as transaction fees, advertising, legal contracts, professional valuations, insurances and even equipment used for crypto ‘mining’ such as a powerful computer and the electricity used.
• If you are buying and selling different types of cryptoasset, you can pool them to work out the average charges etc.
• If you are buying and selling the same cryptoasset, you cannot pool them but keep a record of the exact transaction

Keep Accurate Records – HMRC may Investigate

• Keep records of the types of cryptoasset tokens.
• Record dates, numbers, values in £.
• Keep bank statements.
• Keep cryptoasset ‘Wallet’ addresses.
• Keep records of any ‘pooled’ costs.

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